Whistleblower Claims Hertz Is Using Cops Instead of Collections for Missing Cars

We originally reported on the story of Hertz’s shady theft reports over the fall and winter, but new details are emerging. According to a former manager at Hertz, the popular nationwide car-rental giant has allegedly been going after its own customers.

And not just with pushy upsell tactics.

Instead of relying on collections, Hertz goes right to the courts

MotorBiscuit’s Amanda Cline reported on the issue of Hertz having its customers arrested back in November. Then, we only had stories from customers. At the time, Hertz went on the record to say that claims were “meritless,” and they seem to be sticking to that story.

But, there have been complaints from customers who legally rented and paid for their vehicle, but were pulled over and told their vehicle had been reported as stolen. One attorney is representing more than 250 customers who are suing Hertz for false arrest.

A few months after Hertz’s claim, a judge ordered that Hertz release rental theft report records. The database of reports showed an average of 3,000 stolen-vehicle reports annually over the past couple of years. Hertz claims that the “vast majority” of those theft reports were for vehicles that were weeks or even months overdue.

But now, we’re hearing straight from a source who worked inside the company for over a decade. He’s claiming that Hertz is “using the police department as a repo company and the court system as a collection company.”

A white rental car drives out of a Hertz rental car company location in New York City
Hertz Car Rental location in New York City | Cindy Ord/Getty Images

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Whistleblower speaks out 

Daniel Stokes was a branch and city manager at Hertz, in charge of 24 locations. He worked there for 11 years, from 1996 until 2007, when he claims lost his job because he was unable to return a company car while on medical leave. 

Hertz allegedly reported the vehicle as stolen and Stokes was arrested, prosecuted by local law enforcement, and eventually charged with embezzlement and fired.

NewsNation reports that “hundreds of people are suing Hertz over accusations of mental and emotional damages,” and one of them is former federal agent. The agent claimed that he was pulled over and arrested only hours after legally renting a Hertz car in Oklahoma City in May of 2021.

Even after he was released, police warned the former agent that it might happen again if he didn’t return the vehicle.

Another Hertz renter actually spent seven months in a Georgia jail before the local courts determined that the man had, indeed, paid for his rental car. The court dismissed the case, but that didn’t return the seven months stolen from an innocent man.

Stokes shared with NewsNation that some of the thefts aren’t even thefts at all. It’s a problem with old computer systems that accidentally show current rental customers driving an “unreturned” car that had been returned late by the previous renter. This gives weight to a lawsuit in 2020 that claimed similar problems with the inventory tracking system.

Even bills that did go unpaid should never have become a problem for the court system and the policy. According to Stokes, they should have only gone to a collection agency, like any other overdue bill. Instead of spending the possibly millions of dollars that it would take to update these outdated and broken computer systems, the 2020 lawsuit, and now a former manager, say that Hertz is relying on taxpayers to manage their fleet.

Rather than counting on collections, as they should, Stokes alleges that the company is relying on cops and courts to manage their inventory, and collect on unpaid bills.

Senators Richard Blumenthal and Elizabeth Warren are asking for a congressional investigation into the matter.

Hertz admits issues, vows to change

Hertz CEO Stephen Scherr answered a question about this very topic earlier this month on CNBC’s “Squawk Box,” saying, “This is among the first things I’ve started to look to take care of and deal with in the first 30 days I’ve been at the company. It’s not acceptable to Hertz to have any customer, a single customer sort of caught up in some of what’s happened.”

You can view the unofficial transcript online at CNBC or watch the video linked in the article to see the full conversation. Sherr’s answer seemed to be half sincere, half deflection. But, he told CNBC that he was working to resolve the problem “very, very quickly.” 

Here’s to hoping. Just be sure to return those library books, kids. Who knows what will happen next.

This story is still developing, and we will update as we know more.

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